Why Hire a Property Management Company?
When renting out your property, it’s tempting to try and do everything yourself. It’s not that difficult, right? You just take some phone calls, call a contractor occasionally, and cash the rent checks, right?
Not at all. There’s a lot to managing a rental property, and it might be more than you want to do yourself. Luckily for you, you can hire a property manager to handle most of the hard work. Pay them a percentage of the rent and they’ll take on many of the more difficult parts of renting out your property. It sounds like a perfect trade, but is it the best move for you to make?
Make sure you get a good management company
All of these are contingent on you getting a good management company. Make sure that you find a good one, shopping around to all of the ones you can find in the area. Make sure to get recommendations from other owners for who they work with and who to avoid. If you hire a bad company, all of the benefits of working with a management company can be completely lost, causing even more work and headache than doing everything yourself.
Saves you a lot of time
Your time is incredibly valuable, and you can easily end up losing too much time in running your business. Talking to tenants, putting out advertisements for opening, and many other tasks start to eat up a lot of your time. Even if they only do it as well as you would (and they’ll likely be better), just saving that time can be more than worth it.
Reduced tax and legal stress
Sure, there are tax benefits to renting out a home, but do you know everything you need to keep track of for your taxes? Do you know how to handle all the intricacies of local building codes and other laws? A property manager will be able to help you with or do a lot of these things for you, meaning you don’t have to be as afraid of legal issues. You should still have a good lawyer, but you’ll find yourself less stressed by making sure you’re doing everything you legally need to do for your property.
Someone is always close to the property
If you go on vacation and something goes wrong on your property, what happens? What if you just need to be out of town for the weekend? Your property manager will always be close, so if something goes wrong, it’s not the end of the world – or just a massive headache in the middle of what’s supposed to be a vacation – if you’re out of town.
They deal with the tenants
Do you want to evict anyone? Mediate a conflict between angry residents? Have to pass along maintenance requests to contractors? Follow up with a resident on a late rent payment? Your manager can handle that for you.
They help avoid having a unit vacant for too long
Every day your property sits empty is money you’re losing. That time can be greatly reduced with a good property manager. When the previous tenant moves out, they go straight to getting it filled again. Their greater ability to pay attention to the vacant property means you’ll have greater tenant retention.
You can save money long term
How do they save you money? Don’t they charge a certain percentage of the rent? That’s true, but you’re thinking short term. They help keep your property from staying vacant (see the previous point), which means more money for you. They also do more maintenance work and can spot preventative work that will save you money over the long run – you won’t be there all the time to see signs that might keep a small problem from becoming a big problem. These things add up and can make up for the ~10% of the rent some places will charge.
They let you rent out more properties in more places
How much time do you spend managing your property? You might be spending so much time that you can’t expand your business to more. Or maybe there’s somewhere you saw for sale that you’d love to rent out, but is too far for you to be there often enough. A property manager can help with both of these, handling the dirty work so you can expand your business. Or maybe you just want to live somewhere other than where your property is – a manager will help you greatly with that.
Makes you give up control
This can be a positive or negative, depending on your personality. Do you like being in control of things? Do you want to be really hands-on with regards to improving or working on the property? If so, a property manager might not be right for you, or you may want them only to do the work you don’t like to do.
On the other hand, if you don’t want to do all of these things, this might be the greatest advantage they have. Maybe you don’t want control anyway, and just want someone else to handle the day to day work while you work on growing your business. If that sounds like you, you probably already have a property manager or should hire one right away.
Whether or not you should use a property manager depends a lot on you and how you want to run your business. If the above points sound tempting, then it’s probably the right decision for you. Just don’t enter into this lightly. A bad decision here can cost you a lot of time, stress, and money down the line, so make sure you select carefully and only start working with a company you’re pretty sure is going to work well with you.